At the time the indebtedness was incurred the debt

At the time the indebtedness was
incurred, the debt instrument was duly
notarized and if the loan was contracted
within three (3) years before the death of
the decedent, the administrator or
executor shall submit a statement
showing the disposition of the proceeds of
the loan.
b. All medical expenses incurred within one
(1) year before the death of the decedent
which are duly substantiated with receipts,
provided that the total amount thereof,
whether paid or unpaid, does not exceed
Five Hundred Pesos (P500,000.00).
---ooo0ooo---
XXII
State the conditions
for allowing the
following as
deductions from the
gross estate of a
citizen or resident
alien for the
purpose of
imposing estate tax:
a. Claims against
the estate (2%)

2016 TAXATION BAR QUESTION with
suggested answer QUESTION ON LOCAL
TAX
1. The City of Maharlika passed an ordinance
imposing a tax on any sale or transfer of
real property located within the city at a
rate of fifty percent (50%) of one percent
(1%) of the total consideration of the
transaction. Jose sold a parcel of land in
the city, which he inherited from his
deceased parents, and refused to pay the
aforesaid tax. He instead filed a case
asking that the ordinance be declared null
and void since the tax it imposed can only
be collected by the national government,
as in fact he was paid the Bureau of
Internal Revenue (BIR) the required
Capital Gain Tax. If you were the city legal
officer of Maharlika what defenses would
you raise to sustain the validity of the
ordinance?
ANSWER:
The Ordinance passed by the City Council
of Maharlika imposing a Transfer Tax on
the sale, or any other mode of transferring
ownership at the rate of 50% of 1% of the
total consideration involved in the
acquisition of the property cannot be
declared null and void as Petitioned by
Jose with his contention that he already
paid the Capital Gain Tax. Said City
Ordinance is a Taxing Power granted to
the Provincial, Municipality or Cities,
pursuant to Section 135 of the Local
Government Code of 1991 (LGC).
Transfer Tax paid in the Bureau of Internal
Revenue (BIR) can be either donor’s or
estate taxes which is far different with the
Transfer tax imposed by the Local
Government, hence, there is no reason to
be confuse. Also, the transfer tax paid to
the provincial or city assessor’s office, its
evidence of payment or the official receipt
is required by the Register of Deeds of the
province concerned before registering any
deed. This is also required by the
provincial assessor before cancelling an
old tax declaration and issuing a new one
in its place. The payment of the transfer
tax is the responsibility of the seller,
donor, transferor, executor or and
administrator. As to the rate of tax
imposed it is also compliant to Section
151 of the LGC.
Therefore, Jose has no reason not to pay
nor to question the transfer tax imposed
on him and seek declaration of which to
be null and void.